Thursday, September 13, 2012

MyGuy Customer Retention Practices – Hey, I Know That Stuff Already And I Am Not The Stereotypical OEM! I Can Prove It

David P. Carlisle

As I get older I find myself focusing on the simpler things in life. Understanding a customer’s experience is ultimately very simple. (1) You buy, (2) you maintain & fix, and (3) you buy again. It is a useful exercise to depict all this using common stereotypes. I call it “The Stereotype.” Don’t get defensive; stay with me on this.You buy it … Stereotypically. In the old days, you researched what vehicle you wanted and did most of the shopping on the internet. You chose and negotiated on the Internet and by phone. You came in with lots of data and, after a lot of waiting, found out from the salesman that all this effort and collected data was irrelevant. You found out about additional dealer preparation costs and processing fees that were mandated by the state. The used car person assessed the scrap value of your current ride, and F&I browbeated you into ordering undercoating, extended warranties, and a security system for your new vehicle. Finally, your salesman said he needs you to give him “all 5s” on the survey the factory will send you … because his family depends on him as a breadwinner and he will get burned if he does not get the very top scores. Besides, he reinforced that you were the most important customer in his life. You emerged, feeling a little dopey after an hour or so, with a new ride and a monthly payment exponentially higher than you planned. OK, a lot has changed here. Now, you get coffee cups in the mail after you close the deal.
That takes care of the “buy.” On to service, repair and maintenance.

Next, you own that vehicle for about 5.5 years and take it in for warranty service, maintenance, and miscellaneous repairs. Your point of contact is the dealer’s service advisor. You really don’t want to deal with the technician who’s fixing/maintaining your vehicle because the tattoos are way too distracting. The service advisor used to work on the dealer’s lawn crew and he impressed the man with his entrepreneurial talent. Mow lawns, sell service??? Easy transition. By the way, one of my people’s sons recently started as a service advisor after finishing his undergraduate history degree and working as a bellman at a hotel. Now, this young man is a good kid; but, he has no mechanical knowledge and has never picked up a wrench in his life. The training was watching Ed for a day; then, go get ’em Tiger. … sell lots of flushes to make that $/RO bogie. This is typical, not stereotypical. Dealer Service Advisors are the real implementers of multimillion-dollar OEM customer retention strategies. Pretty cool. Reminds me of a 1994 Jeff Daniels movie. So, the Service Advisor closes out your RO and says he needs you to give him “all 5s” on the survey the factory will send you … because his family depends on him as a breadwinner and he will get burned if he does not get the top scores. Besides, he reinforced that you were the most important customer in his life. You finally emerged after a lot of up-selling, waiting, and unexpected charges. But, he’s not your guy.

OK, a lot has changed here. Now, the dealership surveys you before the factory does to really make sure you give “all 5’s” on the factory survey.
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Of course, the latter maintenance and repair stereotype is not operative in your dealer network. You can prove it yourself just by looking at your defection rates. Hmm. Maybe that won’t work. There are five other tests you can use to show that you are different and not the stereotype.

#1. You have recently updated and documented service advisor best practices – and you train, certify, and measure compliance. This is the foundation. Here’s what I mean, by example; we worked with the top service advisors from four brands and recently did this. Our teams documented service advisor best practices and tied them to service market share. The bar chart shows the difference in market share for dealers spanning the range from always to never utilizing a pre-write-up (the advisor has reviewed each appointment and made notations regarding: this is a repeat customer; what was completed, declined, delayed last time; is there an open campaign or bulletin; what are their preferences for wash, alternative transportation, payment; how I can recognize and call them by name as they arrive – time, vehicle color, names) in advance of customer arrival. The numbers are huge. This best practice is good for dealers and good for service customers. OK, if you are not the stereotype, you’ve got something similar.
#2. You used these best practices to develop a training program for your Service Advisors. A book of best practices will not effectuate change – you need to go out there and make them into believers. You might be thinking that your training organization does this, so you’ve got this one covered. Sorry. Your purchasing organization has negotiated your trainers into a box where there’s no room for innovation, improvement, or excellence. The margins for investment have been squeezed to nothing and what you are buying is a decades-old curriculum brushed off and spruced up to look like whatever you want. Ask the trainers to show you their service advisor best practices and, if they show you them, look for antiquated ideas and concepts. If you pass this test (along with #1) with flying colors, you are not the stereotype.
#3. You’ve nuked your old customer service satisfaction surveys and rolled out a game-proof alternative. This is important. You need to measure true customer satisfaction, not how well your dealers beg for high scores. This is easy; all you need to do is have the first survey question ask, “Did anybody from the dealership tell you that you would be surveyed after the service visit?” If they say “yes,” then throw out that survey response – it has been tampered with. You will have to tell your dealers about this. This is pretty important in engineering a better customer experience at your dealers/distributors. A quality service satisfaction survey is your windshield for driving down the road. Oh, by the way, the survey needs to check and see if service advisor best practices were deployed. So, you really do need those best practices. Do all this (along with #1 & #2) and you are not the stereotype.

#4. It is as easy as 1,2,3 if you can now make sure that your service customers can make an appointment at your dealers. Most of your customers are now “Digital Service Customers (DSCs)” who use the internet in some manner to research and book service. In many cases, OEMs have brilliant web-based service strategies that digitally “walk” the DSC right up to the door of the dealer for service. New millennium technology meets 19th century prison protocols at this point. You need to take control and have a uniform, world-class,

appointment scheduling system. Best-in-class is Xtime. They pretty much own this space as it is defined by cost and quality. The choice is easy; you want a new cell phone? OK, do you go out and get a Blackberry (yuk!) or a new iPhone (of course!)? Same holds true for “i” Xtime. OK, if you’ve got Xtime, along with #1, #2, and #3, then you are not the stereotype.
Most probably, you are the stereotype.#5. You, the factory, need to coddle and catch customers before they defect or spread bad word of mouth. This takes a world-class CRM/call-center strategy. GM is king of the mountain here. They have a room full of Volt advisors who are uniquely assigned to Volt customers to guide them along the ownership experience. GM delivers a Saturn-like customer experience from Saginaw Michigan. They have another group that I call “Santa’s Workshop” that proactively contacts and gifts customers who have recently had high-risk repairs (repairs that, even when done well, can tick off customers). So, you’ve nailed it and have #1, #2, #3, #4, and #5 – you are in nirvana and will pass purgatory and go straight to heaven. However, count yourself lucky if you’ve just got #5 nailed.
Bottom Line. You can carp on and defend what you are and what you are doing. Spend your precious time picking apart why The Stereotype does not pertain to you and your company. But, ultimately, you really are The Stereotype. It is time to do something about it.